Dow Inches Up; Most Stocks Fall
Investors continued to take a wary view of stocks, as the broad market fell Thursday for a fourth straight session.
The exception, once again, was the Internet sector, which saw numerous small stocks soar in frenzied trading.
The Dow Jones industrial average added 5.92 points to 8,829.74, but that was only thanks to sharp gains in the index’s two oil stocks, Exxon and Chevron, amid rising tensions between the United States and Iraq.
In the broad market, losers outnumbered winners by 17 to 14 on the New York Stock Exchange and by 22 to 18 on Nasdaq.
Analysts said investors have had good reason to step away from the market this week, with a new U.S. strike against Iraq looking increasingly likely, and with the Federal Reserve Board meeting on Tuesday to ponder what, if anything, to do with interest rates.
“Any time there is uncertainty, markets are apprehensive,” said Joe Stocke, a senior portfolio manager at Meridian Investment Co. “There is always the question that Iraq could do something to spread the problem to Israel or Saudi Arabia.”
Still, losses were modest among major stock indexes. The Standard & Poor’s 500 eased 0.3%. The Russell 2,000 small-stock index slipped 0.3%.
In other markets, Treasury bond yields fell and the dollar rose as investors sought safety amid rising tension in the Persian Gulf.
The yield on the 30-year Treasury bond slid to 5.25% from 5.29% on Tuesday. (The bond market was closed Wednesday.) The yield on two-year T-notes fell to 4.47% from 4.52%.
The dollar edged up to 121.98 Japanese yen from 121.72 on Wednesday.
“There’s always a flight to the dollar whenever there’s the threat of military action,” said Malcolm Gilroy, who oversees $200 million of global bonds at Laketon Investments Management in Toronto.
Also helping demand for dollar assets and the dollar itself were doubts that Japan’s latest plan to raise spending and cut taxes will succeed in lifting its economy out of recession.
Tokyo shares fell 2.5%.
Among Thursday’s highlights:
* The Internet-related stock sector zoomed again, after some profit-taking on Wednesday.
“Guys are sitting at home in front of their computer on E-Trade buying Web stocks,” said Needham & Co. analyst Dalton Chandler.
Among the day’s big gainers was EarthWeb, an online services provider to other information technology firms, which soared $20.56, or 42%, to $69.25 on its second day of trading. The company’s initial public offering was at $14 Wednesday.
Others making sizable advances were EBay, up $10.06 to $126; Yahoo, gaining $8.25 to $173.25; Lycos, soaring $4.25 to $53.06; and Inktomi, up $6.81 to $127.56.
Set to begin trading today: Theglobe.com, whose IPO was priced at $9 late Thursday.
* Major tech shares were mixed. Dell Computer dropped $2.75 to $69.19 a day after rival Compaq Computer said it too will sell computers directly to customers. Compaq fell 63 cents to $33.88.
* Oil stocks gaining included Exxon, up $2.56 to $72.81; Chevron, up $3.13 to $83; Atlantic Richfield, up $3.63 to $69.50; and Unocal, up $1.69 to $35.50.
* Danaher rose $2.38 to $42.75 after Standard & Poor’s announced that the toolmaking company will be added to the S&P; 500 index on Tuesday, replacing Stone Container, which is being acquired by Jefferson Smurfit. The stock of a company about to be added to the S&P; 500 will often jump as funds that track the index buy the stock.
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Market Roundup, C6
